"The more rapidly the temperature of the water increases with depth, the better.

"It's already at 50 per cent higher than the UK average for that depth, which gives us a lot of options.

"There isn't really a limit to what we might gain from this. There is a huge volume of hot water down there; we could go on adding boreholes to run systems alongside this wherever there is the opportunity."

The project is funded by the Newcastle Science City partnership and the Department of Energy and Climate Change.

The borehole on the site of the former Newcastle Brewery today reached a depth of 2,000m (6,562ft).

Energy will be extracted from hot water being pumped out at a temperature of about 80C (176F).

Mr Younger said: "Our aim is to rise to the challenge of putting a novel form of deep geothermal energy at the very heart of city centre regeneration.

"It's an incredibly exciting project. If we're right and we pump up water at such elevated temperatures, it would mean a fully renewable energy supply for a large part of the city centre."

Laura Armstrong is one of Newcastle University's geology students who has been examining the 300-million year old fossils.

She told the BBC: "It is one of the most exciting things we've found.

"These shells and corals suggest that Newcastle was once a tropical environment, like offshore Bahamas."

Felicity Eden, 26, of Shieldfield, Newcastle, said: "You could have fooled me. I moved here last week and it has poured with rain every single day since."